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Current Developments in the Commercial Divisions of the
New York State Courts by Schlam Stone & Dolan LLP
Posted: June 23, 2019

Non-Client Adequately Alleged Fiduciary Duty Claims Against Law Firm

On June 11, 2019, the First Department issued a decision in Devlin v. Greenberg Traurig, LLP, 2019 NY Slip Op. 04653, holding that a non-client had adequately alleged breach of fiduciary claims against a law firm, explaining:

The court dismissed the fiduciary duty claim on the ground that there was no fiduciary relationship between the parties. However, plaintiff alleges that he — as well as Fiore Films LLC — was defendant’s client. He does not base his claim of an attorney-client relationship solely on the fact that he paid the bills that defendant sent to Fiore Films and was a part owner of that entity. The amended complaint alleges that defendant knew that plaintiff was dependent and was relying on it to provide honest and diligent advice with respect to escrow funds. In addition, the affirmation by plaintiff’s lawyer Gerard Keogh, which plaintiff submitted in opposition to defendant’s motion, says, As early as 2011, Steven Beer the partner at defendant responsible for the engagement knew that he had to advise and counsel Plaintiff individually.

Defendant suggests that it could not have represented plaintiff because he was already represented by Keogh. However, Keogh said, Since I did not have experience in the Entertainment Sector, I advised plaintiff to secure the representation of an experienced Entertainment lawyer. It is certainly possible for a client to have more than one lawyer.

(Internal quotations and citations omitted).

We both bring and defend breach of fiduciary duty and professional malpractice claims and other claims relating to the duties of professionals such as lawyers, accountants and architects to their clients. Contact Schlam Stone & Dolan partner John Lundin at jlundin@schlamstone.com if you or a client have questions regarding such claims or appeals of such claims.

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